67 Misc. 72 | N.Y. Sup. Ct. | 1910
This is an action against the defendant as the maker of three promissory notes and accommodation indorser of a fourth. The only serious defense is the discharge of the defendant in a bankruptcy proceeding com
The note upon which defendant was accommodation indorser was given prior to the filing of the petition, but it did not fall due until thereafter. It was, therefore, at the time of filing the petition, merely a contingent liability. Whether the contingent liabilities of a bankrupt are provable under the present law was at first a matter of dispute, and there were several decisions holding that they were not provable. These decisions were afterward overruled, and it is now well settled that the holder of a note indorsed by the bankrupt, although it fall due after the filing of the petition, but within the time allowed for the filing of proofs of claim, may prove it against the estate and have it allowed, in case the contingent liability, upon the due date of the note, becomes an actual liability. Although the present bankruptcy law does not expressly provide that contingent claims are provable, as did the Laws of 1841 and 1867, nevertheless such a liability is held to be a debt “upon a contract express or implied ” under section 63a (4). Moch v. Market Street National Bank, 107 Fed. Rep. 897; Matter of Philip Semmer Glass Co., 135 id. 77. The reasoning is fully set forth by Brown, J., in Matter of Smith, 146 Fed. Rep. 923. Hence this note was provable; and, therefore, although it was not actually proved, it had been discharged by section 17 of the law.
Since, however, judgment was entered for the defendant upon all four notes, it should be reversed and a new trial ordered, with costs to abide the event.
Judgment reversed and new trial ordered, with costs to abide event.
